Top quartile c-store retailers have adapted their offering and execution to meet changing customer needs, but the threat of disruption grows louder still. While most retailers have been grappling with how to transform themselves amid digital disruption for some time, the COVID-19 pandemic introduced new and unexpected challenges. Still, many c-store chains are responding with solutions that will enable them to maintain and even increase market share — from rolling out curbside pickup to offering delivery. Some chains were better positioned to respond in a nimble way because they had innovation hubs where they had been testing solutions.
As Harvard Business School professor Clayton Christensen famously argued in his 1997 book, “The Innovator’s Dilemma,” even companies that reach a state of consistently near-perfect execution could easily wind up left in the dust, and not by the store across the street, but by an emerging force or trend that pulls in the competitor(s) from outside the industry and renders even the strongest players obsolete, seemingly overnight.
The “innovator’s dilemma” is described as “doing the right thing is the wrong thing.” By focusing on the ‘here and now’ with regards to what customers want — and what they’re great at delivering — without constant innovation and, when necessary, reinvention, they risk being disrupted out of business.
But rolling out innovations across an entire retail chain can be risky. “Having a live environment to test the idea, its rollout and the customer reaction first can be invaluable to increasing the speed and lowering the risk of introducing innovations to the retail environment,” said Garrett Law, co-founder of consulting firm Attention Span Media.
Sheetz, on Oct. 1, 2019, opened its technology and innovation hub in Pittsburgh. The center is home to Sheetz’s growing innovation team and technology development specialists and serves as a meeting place for collaboration. Sheetz also devotes space for a tech incubator at the Sheetz Operations Support Center in Claysburg. Specific activities include developing, testing and implementing products and services that “will one day appear on Sheetz shelves across its stores,” according to the company.
As COVID-19 escalated, Sheetz was quick to adapt. It rolled out its ‘SHcan & Go!’ feature in its mobile app for self-checkout and announced a partnership with delivery company Grubhub.
7‑Eleven, also known for its innovations, in March 2019 introduced its “lab store,” in Dallas, which it described as “an experiential testing ground, where customers can try and buy the retailer’s latest innovations in a revolutionary new store format.”
And, in Media, Pa., Wawa operates the Wawa Innovation Center, where it runs menu experiments and tests new technologies that impact the company’s processes.
Other retailers use test kitchens or test stores, too.
But a word of caution before embarking on your own: Because innovation groups are often physically independent from the rest of the chain, “it’s crucial to make sure they are able to articulate what they learn and properly socialize it throughout the company, or else the risk is that whatever they learn will be lost in bureaucracy or misapplied,” advised Law.
David Hochman is the owner of DJH Marketing Communications Inc. He can be reached at [email protected]